AN

INDUSTRIAL DESK RESEARCH ON

“A STUDY ON THE TRUTH

OF INDIAN DAIRY INDUSTRY”

SUBMITTED TO
SAVITRIBAI PHULE PUNE UNIVERSITY FOR THE PARTIAL

FULFILMENT OF THE COURSE MASTER IN BUSINESS

ADMINISTRATION

SUBMITTED BY
ROLL NO. 01
ROLL NO. 08
ROLL NO. 21

GUIDED BY
PROF. DR. PRASHANT PATIL
1
 INDEX

Chapter No. Particular

01 Introduction
1.1 Introduction The Project 5
1.2 Large Commercial Dairies (Mega 6
Dairies)

1.3 Urban & Peri- Urban Dairies 7

1.4 Smallholder Backyard 8
1.5 Legal & Policy Framework 10
02 Investigation Methodology
2.1 Investigation Methodology Criteria 11
2.2 Investigation Method 12
2.3 Officials For The Investigation 13

03 Investigation Results
3.1 Investigation Results
15
3.2 Types Of Dairies
16
3.3 Red Lines For Cattle Dairies
17
3.4 Outcomes Against The Red Lines

04 CONCLUSION 22

2
 ACKNOWLEDGEMENT
We have pleasure in successful completion of this work title: “A study on the truth
of Indian dairy industry”.

We acknowledge the support and encouragement extended for this study by HOD
Prof. Dr. Rakesh Patil.

We are very thankful to Prof. Dr. Prashant patil for his encouragement and
guidance for this project.

We acknowledge the authors, who gave us insight and information related to the
subject.

3
CHAPTER: 01
INTRODUCTION

4
1.1 INTRODUCTI ON THE PROJECT
The 'White Revolution' in India was brought by the launch of “Operation Flood” in
1975, under which the milk production in the country increased from 22 million
tonnes in 1970 to 104 million tonnes in 2008. Currently, India is the largest
producer of milk in the world, accounting for 18.5 % of world production,
achieving an annual output of 146.3 million tonnes during 2014-15 as compared to
137.7 million tonnes during 2013-14 recording a 1 growth of 6.3 %.

This massive increase in production capacity of the country has been made
possible by introduction of Jersey, Cross breeds and Holstein Friesian variety of
cattle that have been genetically selected to produce unnatural average output of 20
liters per milking per day per animal! In order to meet the high milk production
targets, these animals are over-exploited thereby, resulting in cruel dairy practices.
Such practices also reduce the average lifespan of dairy cattle and increases the
risk of reproductive diseases and udder infections.

The life of a dairy cow lasts for an average of 10 years in a dairy establishment as
compared to 25 naturally! The images of happy cows feeding on green pastures are
the perfect façade for a truly cruel and increasingly space- deprived dairy industry.
FIAPO's dairy investigation in 10 states of India reveals the ugly truth behind the
“White Revolution” of India, where dairy cattle, especially in urban and peri -
urban areas, get little access to soft ground, spend their lives in cramped, poorly
ventilated and dark enclosures.

Moreover, many dairies were found to have ill, injured and distressed cattle. Poor
veterinary care and illegal use of drugs and hormones like oxytocin to increase the
milk let-down are prevalent. Multiple wounds were also observed. Thus, an evident
delinking of humane treatment of cattle as sentient beings is being noticed
5
as a result of the rising demand for milk and milk products. This situation persists
mainly because all these methods are considered “normal” and best practice in
terms of economic gain and cost cutting for profits, by the dairy industry. The
report calls for urgent and strict implementation of the existing laws of animal
welfare as well as urban governance. It also highlights the need for additional
regulation in select areas where there are significant violations of acceptable
conditions for dairy animals as well as growing civic problems.

6
1.2 LARGE COMMERCIAL DAIRIES (MEGA DAIRIES)

These are of relatively recent vintage and are a means of investment for
entrepreneurs looking for “sunrise” sectors that have a potential of high rates of
return. Such dairies are coming up in traditional milk powerhouses like Haryana,
Punjab and Andhra Pradesh.
This is a rapidly growing sector and progressively a number of established
businesses are examining the feasibility of entering the dairy industry through large
commercial farms.
It has been observed that there are a number of fence sitters that are waiting to see
the performance of enterprises that have already invested in commercial farms.
Interestingly animal husbandry departments of certain states also run “model”
dairies that fall within this category insofar as they raise animals in a manner
similar to commercial dairies.
There is a new trend where some dairy owners have started specializing in
breeding and selling high yielding HF animals. Such entrepreneurs buy heifers
from various auctions, rear and breed them on their farms. The animals are milked
but only surplus is sold off in the market.
These farmers maintain the animals really well so that these can be sold to dairy
farms on the basis of their high productivity. There is information from Haryana
about some dairy farmers shifting from milking operations to breeding.
Due to less input of labor and high returns – as the animals can be sold at a very
high price, this ‘business’ is considered less laborious and more profitable than
dairying.

Key characteristics:
a. Typically set up as business ventures.
B. Typically in semi-rural areas or on the edge of cities. Not in remote areas.
c. Largely cross breeds and buffalos.
d. Relatively mechanized.

7
e. Quality control – Rudimentary to high.
f. Some investment in animal health.
g. System of replacement stock.
h. Environmental management system – rudimentary to high.
I. Average herd size 300 and upwards.

8
1.3 URBAN & PERI- URBAN DAIRIES

Mainly concentrated in and around cities and are oriented towards meeting the
high milk demand of urban centers. These facilities vary in size and are often
limited because of space constrains in urban areas.
There are overlaps between dairies classified as large commercial dairies and these.
The essential difference between the two is the nature of entrepreneurial outlook.
The urban dairies typically are focused on quick short term profit and hence
severely compromise not only animal welfare and health but also environment
pollution and milk quality. In fact these dairies are the progenitors of “synthetic
milk” and food safety is a key area of concern with their operations.

Key characteristics:
a. Typically setup to make short term profit.
b. Located in and around urban areas that have a large market for milk.
c. High yielding animals, including buffalos.
e. Poor or no quality control.
f. Little investment in animal health.
g. Lactating animals purchased and sold off after a lactation ends.

9
1.4 SMALLHOLDER BACKYARD
These are dairies which still operate outside of the cooperative framework and
mainly functional in outskirt of cities. We have also found a number of cases of
hybrid operations where small holders would opportunistically sell to
cooperatives or to the unorganized sector depending upon the returns available.

Key characteristics:
a) Mainly as a livelihood support activity. This often complements the basket
of livelihood options of the family.
b) Mainly indigenous breeds. Often buffalos.
c) No mechanization, other than at cooperative collection centers.
d) No quality control by individuals. However, cooperatives may impose some
form of quality control upon individual members.
e) Little or no veterinary support. Again, cooperative members will be an
exception and may have access to animal health services.
f) Replacement usually through progeny of existing animals.
g) Waste management does not pose a challenge because of small herd size and
free grazing regimes.
h) Small herd size - 2 to 6 animals.

10
1.5 LEGAL & POLICY FRAMEWORK
There exist several national laws and guidelines to assist dairy owners in
implementing the best and humane practices of milk production and animal care
such as:
1. The Prevention of Cruelty to Animals Act, 1960
2. The Prevention of Cruelty to Animals (Registration of Cattle Premises)
3. Prevention of Cruelty to Animals (Transport of Animal) Rules, 1978
4. Food Safety and Standards Act, 2006
5. Government of India, Ministry of Agriculture and Department of Animal
Husbandry advisory dated 2nd December, 2014 on use of antibiotics on food
producing animals.
6. Technical guidelines to states for implementation of various components of
centrally sponsored scheme “Livestock health and Disease Control” by the
Ministry of Animal Husbandry, Dairying and Fisheries.
7. Guidelines of the sub-scheme Special Programmed for Dairy Development
as a part of National Mission for Protein Supplements under Rashtriya
Krishi Vikas Yojana (RKVY).
But sadly these are violated to ease the process of increasing the milk production in
order to meet the rising demand for milk and milk products- demand which often
itself is created through advertising.
The results of this investigation expose the dark side of the dairy industry, the
cruelty meted out to the dairy cattle and the unsanitary conditions of milk
production.
By collating this data, FIAPO aims to bring reform in the dairy sector and ensure
implementation of adequate standards of health, infrastructure and milking
practices in the dairy industry of India.

11
CHAPTER-02
INVESTIGATION METHODOLOGY

12
2.1 INVESTIGATION METHODOLOGY CRITERIA
We considered the following while choosing states for the dairy investigation:
1. Population of dairy cattle in the state
2. Milk production in the state
On the basis of these criteria Punjab, Telangana, Maharashtra, Madhya Pradesh,
Uttar Pradesh, Gujarat, Rajasthan, Haryana and Tamil Nadu were picked as the
states where the investigation would be carried out. In addition the National
Capital Territory of Delhi was picked because of its strategic significance and also
as the center of media attention.

13
2.2 INVESTIGATION METHOD
Once the states and the teams that would work in each state were finalized, the
respective state teams were trained in how the investigation was to be conducted..
This included details on the actions to be undertaken before, during and after the
investigation, the type of evidence (photographic, video, data, etc.) to be collected
and a questionnaire designed to enable the investigators to comprehensively cover
all facets of dairy animal management and welfare.
Some of the Important Checklist Requirements to enable the collection of
concrete data were:
1. Mapping of the Animal Husbandry network in the state to get adequate
information on the areas in which dairies are present and the number of
different types of dairies in each district.
2. In addition to the information collected from the Department of Animal
Husbandry, collection of data based on the on-ground research for the
number of dairies to be investigated in the urban, peri-urban and remote
areas of each district.
3. A list of all animal protection/ welfare groups in the state for local on- field
help during the investigation.
4. A list of the number of mega dairies in the state, to ensure that these are
covered as one of the three main types of dairies to be investigated.

14
2.3 OFFICIALS FOR THE INVESTIGATION

 Telangana-
People for Animals, Hyderabad

 Maharashtra-
PALs Pune, TSPCA, PFA Wardha, Independent Volunteer Nagpur

 Madhya Pradesh-
PFA Indore, Independent Volunteers - Sagar, Vidhisha, Bhopal

 Uttar Pradesh-
VFAPO, Mercy for All, Living Free Volunteers Lucknow, SPCA Gorakhpur

 Gujarat-
Independent Volunteers - Ahemdabad, Gandhinagar, Anand, PRAYAS Surat

 NCT Delhi-
DHYAN Foundation

 Rajasthan-
JFAPO, Jodhpur Gauraksha Dal, Pannalal Gaushala Jodhpur, Jeevjantu Kalyan
Seva Kendra Bikaner, Alwar Gauraksha Dal

15
CHAPTER-03
INVESTIGATION RESULTS

16
3.1 INVESTIGATION RESULTS
451 Dairies were invested in 10 States with 24,456 Cattle

State No. of Dairies No. of Cattle

Uttar Pradesh 50 2246

Rajasthan 49 1232

Telangana 45 1879

Gujarat 47 2446

Punjab 50 3998

Madhya Pradesh 42 2746

Maharashtra 35 3008

Haryana 48 3108

Tamil Nadu 35 1293

NCT Delhi 50 2500

17
 3.2 TYPES OF DAIRIES
Table Depicting the Types of Dairies Covered in each State as Part of the
Investigation

Large Commercial/ Urban, Per Small Holder

State Mega Dairy (300 Urban
Cattle and More)

Uttar Pradesh
0 29 21

Rajasthan 0 41 8
Telangana 2 25 18
Gujarat 0 31 16
Punjab 4 39 7
Madhya Pradesh
1 23 18

Maharashtra 2 14 19
Haryana 3 25 20
Tamil Nadu 0 17 18
Delhi NCT 0 30 20

18
3.3 RED LINES FOR CATTLE DAIRIES

Certain parameters have been called “Red Lines” as they have been identified as
basic animal welfare conditions that are non - negotiable for cattle in dairies. These
are:-
1. Flooring and bedding – Dairy animals have a strong behavioral need to rest
and spend most of their time resting. They must have a comfortable resting
space. The bedding areas of all animals must be clean and comfortable with
non-slip flooring. Bare concrete is not an acceptable surface especially for
resting.
2. Tethering of animals – Dairy cattle must not be chained or tied throughout the
day. If required, cattle should only be tethered for a short period of time (on a
reasonably long tether so as to allow the animal to sit and stand comfortably) as
and when required by a veterinary doctor, for other anomalous conditions or for
milking.
3. Use of oxytocin – There must be no use of oxytocin for increasing milk let-
down.
4. Separation of mother and calf (or weaning age of calves) – The calves must
stay with their mothers for a minimum of 3 months to 6 months from birth.
5. Management of male calves – Male calves must not be left to die or
abandoned or illegally sold.
6. Veterinary care – Adequate veterinary care must be provided with regular
check-ups for cattle.

19
3.4 OUTCOMES AGAINST THE RED LINES
The field observations were compared against the Red Lines that represent the
basic standards that must be followed for cattle in dairies. The outcomes of the
investigation are:-
1. Flooring and bedding –
46.4% dairies overall had brick and cement flooring which is not a safe or
comfortable surface for animals to live on.
State with the worst practice: Punjab - 90% dairies had unsuitable flooring

2. Tethering of animals –
78.8% dairies did not allow the animals to move freely at all and kept them
continuously tethered.
State with the worst practice: Maharashtra and NCT Delhi - 100% dairies did
not allow their cattle to move freely without being tethered.

3. Separation of mother and calf -

73.89% dairies overall weaned off the calves at the age of 3 months and under.
State with worst practice: Rajasthan, Telangana and NCT Delhi - 100% dairies
did not allow the calves to stay with the mother for more than 3 months.

4. Use of oxytocin-
Indiscriminate use of oxytocin was observed throughout the states in 46.9%
dairies. This is mainly significant on buffalo farms.
State with the worst practice: Tamil Nadu - 60% of dairies used oxytocin

5. Management of male calves -

Male calves are considered a “waste” by the dairy industry. They die either due to
20
neglect (25.1%) or are sold for slaughter or to smaller farmers (43.3%).
State with the worst practice: NCT Delhi - None of the dairies had male calves
older than 2 months.

6. Veterinary Care -
Provisions of veterinary care depends on the economic status of the dairy owner. In
84.3% dairies visited, veterinary help is only provided to cattle in case of sickness
or injury.
State with the worst practice: Telangana - 93.3% of dairy owners provided
veterinary help to cattle only in case of sickness or injury

21
CONCLUSION
This first-of-its-kind investigation in India's largest milk producing states as well
as in the national capital has revealed the dark underbelly of the mushrooming and
unregulated milk production industry.
Traditionally only milk processing has been regulated to offer better procurement
prices to dairy farmers, prevent hoarding and make milk readily available to
consumers. The practice of producing milk, has however, been largely unregulated.
Historically, this was possibly because typically production and sale of milk was
one of the components of a diverse livelihood basket of a farmer. However, as the
dairy sector has progressively commercialized, particularly post the 1990s, a range
of players has entered, not just the milk processing space, but more importantly the
milk producing sphere.
Such commercialization coupled with the complete absence of any form of
regulation has resulted in the booming of production practices that have severe
impacts on the animals themselves (as enumerated in this report) as well as
questionable quality of milk produced, environmental mismanagement
(particularly in urban areas) and civic problems owing to stray cattle.
As this investigation has revealed, the worse infringements are wrought upon by
dairies located in and around towns and cities in the country. These impact not just
the animals themselves, but the state of the town/city as well.
As such, the following actions are needed to correct the near complete operation of
a laissez faire environment in the milk production sector. These are a combination
of actions by the Centre, State governments, and statutory regulators like the
FSSAI:
 A stringent licensing regime needs to be brought in for keeping dairy
animals within urban areas – Municipal Corporations and Municipalities.
Licensing needs to include the conditions that are necessary for acceptable
maintenance of cattle, particularly in terms of space, opportunities for
movement and other natural behaviors, as well as waste management, and
preventing straying of animals. An indicative list of such conditions is at
Annexure II. This is within the realm of state governments via rules framed
under state municipal acts.
22
  Certain High Courts as well as certain Municipal administrations have
passed orders to entirely prohibit the keeping of dairy animals within
municipal limits. This is possibly a course of action to be taken for areas
where it is felt that it is not possible to meet the licensing conditions. This
would particularly apply to Tier I and Tier II cities. This is again something
that state governments are empowered to do.
 In all other areas (other than Municipal Corporations and Municipalities), all
commercially driven milk production to be regulated in terms of the
conditions in which the animals are bred, reared, milked and disposed. An
indicative list of such conditions is at Annexure II. For the purpose of
regulation, “commercial” could be defined as units that hold 20 animals or
more.
 The central government through the instrument of the Registration of Cattle
Premises Rules 1978 has the latitude to fame conditions for setting up of
dairies and ownership of milch animals. Amendments to the Rules as they
currently exist, can serve the purpose of including conditions for regulating
dairies.
 Finally, the Food Safety and Standards Authority of India currently only
regulates and sets standards for milk processing facilities. It too can specify
conditions to be followed and standards to be met by dairies at the point of
milk production.
It is imperative that the expanding dairy industry is regulated at the point of milk
production. This has implications not only for the animals themselves, but also for
the quality of milk thus produced, environmental management and civic
governance, particularly in urban areas. It is unlikely that Indian cities will turn out
to be particularly “smart” unless attention is focused on root causes such as this.

23
 REFERENCES
 Press Information Bureau, Government of India, Ministry of Finance, 26th
February 2016. Extracted on 3rd March, 2017-04-17.
Source: http://pib.nic.in/newsite/PrintRelease.aspx?relid=136849

 Top 10 highest milk producing states in India, Sharma, Ram, September, 2016.
Extracted on: 10th January, 2017.
Source: http://www.trendingtopmost.com/worlds-popular-list-top-10/2017-2018-
2019-2020-2021/agriculture/highest-milk-producing-states-india/

 National Dairy Development Board, Milk Production by Sates (2014- 2015).

Extracted on 12th February, 2017.
Source: http://nddb.coop/information/stats/milkprodstate

 Endocrinological interventions to augment nutritional security, Prakash, B.S. 2013.

Physiology and Nutri- Genomics- Underpinning Animal Production. Extracted on
17thMarch2017.
Source:https://www.researchgate.net/profile/Dr_Brijesh_Yadav/publication/26125
2832_Heat_stress_As_it_affects_nutrient_digestibility_and_methane_emission_in
_ruminan ts/links/0deec533b9abcc7127000000/Heat-stress-As-it-affects-nutrient-
digestibility- and-methane-emission-in-ruminants.pdf

 Holy cow- Research Insight into Dairies of India by FIAPO and WSPA, April
2012. Extracted on: 22nd April, 2016.

 Top 10 highest milk producing states in India, Sharma, Ram, September, 2016.
Extracted on: 10th January, 2017.
Source: http://www.trendingtopmost.com/worlds-popu-lar-list-top-10/2012018
24
 Kamdhenu Yojana, Government Orders/Circulars Regarding Kamdhenu/ Mini
Kamdhenu/ Micro Kamdhenu Scheme, 2016. Extracted on 10th January, 2017.
Source: http://animalhusb.up.nic.in/Kamdhenu_Yojana.htm

 State of Dairy Cattle –Rajasthan, FIAPO, June 2016. Extracted on 10th Januray,
2017. Source: http://www.fiapo.org/wp-content/uploads/2016/06/Final-English.pdf

25